Ofgem investigate profit margins of home energy suppliers

26 November 2010

In news to be filed under "no shit, Sherlock", Ofgem has announced an investigation into recent increases in energy prices, on the basis that suppliers are using the price hikes to make more profit than they should.

Rather than covering any escalating costs in supplying energy, the regulator believes the increases have swollen the coffers of suppliers by nearly 40 per cent - from an average net profit of £65 per customer in September, to £90 per customer now, based on recent increases by half the major energy suppliers.

Scottish Power recently announced they'll hike up electricity tariffs by nearly nine per cent, Scottish and Southern Energy customers are in for a 9.4% rise in their gas bill, while British Gas recently announced a 7% increase in gas and electricity charges.

Such an investigation does not guarantee prices will drop, or that any action will be taken against suppliers - but then again it rarely does: "We will go beyond our usual quarterly reports on prices and do a comprehensive review of the retail market and our recent reforms from the consumers' perspective," said Ofgem.

TOPICS:   Utilities

10 comments

  • The B.
    I got a letter from NPower the other day saying they had reconsidered and were refunding me £36, what they actually meant was "we screwed you and Ofcom forced us to give you money back", either way it's why I left them in the first place.
  • The B.
    Didn't Labour start an investigation into high oil prices at one point? Didn't it also get dropped after pressure and non co-operation from the oil companies?
  • PokeHerPete
    @BitterWallet - You forgot the caption to the image "Some gas, yesterday"
  • PaulH
    How would one go about getting money back from these bastards - we got our Electricity bill the other day and since the last one it had gone up about 95% even though we hadn't changed our energy habits
  • klingelton
    made me lol
  • ifonly
    Ofgem = toothless wonders. The big six energy firms are in a cartel and have stiched up the market. Ofgem are happy to fiddle around the margins but don't have the power to do anything to inconvenience their profit margins. Which is nice.
  • Gunn
    I'm only a few months back the companies said they were going to put up prices as they need to invest in storage/transportation facilities so that we are no so reliant on external supply, which is a good idea but I hate the timing of increasing it during winter.
  • singhster
    The energy firms will be shitting their pants. No Xmas for them. I got £27 back from NPower, the biggest shower of shits you could imagine.
  • zax
    British gas - my gas provider r increasing prices. Mna, I have to go and compare tarifffs, the rate per kwh and then switch again./ GRR
  • The B.
    PaulH, this is from 2006 when NPower decided there were only 10 months in a year.

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